[Today's Guide]
○ CBRC arranges debt-for-equity swaps, SOEs with high debts to participate
○ Policies support private investment in medical sector, private hospitals expected to expand rapidly
○ Glyphosate price keeps growing, institutions think potential for price to continue to hike
○ Actual controller of Tatwah Smartech transfers 7.8 pct. equity to Zhicheng Investment Center, actual controller of Int'l Group possibly to change
[SSN Focus]
○ CBRC arranges debt-for-equity swaps, SOEs with high debts to participate
------
China Banking Regulatory Commission (CBRC) held a video and telephone conference on the supervision and regulation on the national banking industry in 2017 on Jan. 10 and made plan on key tasks of the year. It proposed to steadily conduct market-based debt-for-equity swaps and support de-leveraging. The subjects, prices and conditions of debt-for-equity swaps shall be determined through independent negotiation and quality enterprises with rosy prospects and temporary difficulties will be encouraged to conduct market-based debt-for-equity swaps. The total agreed amount of debt-for-equity swaps has exceeded 300 billion yuan, indicated Xu Shaoshi, Chairman of National Development and Reform Commission, on the same day.
Comment: State-owned banks have introduced various debt-for-equity swap programs recently. The Industrial and Commercial Bank of China and SOEs in Shanxi, including Taiyuan Iron ＆ Steel Group, Datong Coal Mine Group and Yangquan Coal Industry Group, China Construction Bank and SOEs in Shaanxi, including Shaanxi Coal and Chemical Industry Group, Shaanxi Non-ferrous Metals Holding Group and Shaanxi Energy Group have signed agreements with tens of billions of yuan. Institutes are rosy about SOEs with high debts in coal, iron ＆ steel, non-ferrous and other cyclical industries to benefit from optimized financing structure. The profitability of AMC companies as professional agencies for the disposal of bad assets will be improved.
[SSN Selection]
○ The government work report released by Ningxia Hui autonomous region on Jan. 10 proposed to actively develop mixed-ownership economy. The government work report released by Tibet autonomous region laid stress on the integration and reorganization of state-owned enterprises.
○ The National Technology Work Conference was held on Jan. 10. Wan Gang, minister of science and technology, indicated that the special plan for artificial intelligence will be worked out in 2017.
○ The Air Traffic Management Bureau of Civil Aviation Administration of China indicated that the investment demand in China's air traffic management system is expected to total 57 billion yuan during the 13th five-year plan period (2016-2020), and the construction of infrastructure for air traffic management will be accelerated.
○ SSN learnt that the core premium indicators of listed insurance companies embraced "a good start" in the first week of 2017, and product cost also obviously declined.
○ The securities margin witnessed a net outflow of 18.7 billion yuan in the first week after the New Year, while the same periods of previous two years both saw a net inflow of over 100 billion yuan.
TOP
[Industry Information]
○ Policies support private investment in medical sector, private hospitals expected to expand rapidly
------
The State Council proposed various development indicators for the medical sector in the recently-issued 13th Five-Year Plan on public healthcare. One of the most prominent indicators is that by 2020 the proportion of berths in private hospitals should increase to over 30 percent from 19.4 percent in 2015. The plan also proposes to develop private investment in the medical sector and encourage private capital to participate in the health service sector.
Comment: Institutes point out that under the background of supportive policies and extremely imbalance of supply and demand of medical services, private capital will maintain a high passion to invest in hospitals. Private hospitals are expected to integrate doctor resources to improve their quality and contents of medical services and expand rapidly. Ningbo Sanxing Medical Electric Co., Ltd. (601567.SH) has transformed its business to medical services after acquiring the largest grade-III hospital Zhejiang University Mingzhou Hospital in Zhejiang province. Guizhou Yibai Pharmaceutical Co., Ltd. (600594.SH) owns three hospitals and several treatment centers. The company has actively transformed to precision treatment for tumor.
TOP
○ Glyphosate price keeps growing, institutions think potential for price to continue to hike
------
Enterprises continue to raise quotation of glyphosate in recent week. FOB of 97 percent of raw powder of Jiangsu Yangnong Chemical Co., Ltd. (600486.SH) at Port of Shanghai is raised by 200 US dollars per ton to 3,500-3,600 US dollars per ton now. Price of 98 percent of pmida of Sichuan Hebang Biotechnology Co., Ltd. (603077.SH) is raised by 500 yuan per ton to 16,000 yuan per ton in Port of Shanghai. Glyphosate price keeps growing by over 40 percent since the fourth quarter of last year.
Comment: Securities traders think that there is still potential for price of glyphosate to increase driven by tightened policy on environmental protection and small input in newly-added capacity. In addition, re-stocking of downstream enterprises and recovery in agrochemical industry will boost demand to pick up. Yangnong Chemical owns annual capacity of producing 30,000 tons of glyphosate. It has sophisticated technologies, which are in accordance with environmental protection, and has stable profitability. Hebang Biotechnology owns production capacity of 50,000 tons of glyphosate and 135,000 tons of pmida. It keeps running in full capacity since the beginning of this year.
TOP
[Announcement Interpretation]
○ Actual controller of Tatwah Smartech transfers 7.8 pct. equity to Zhicheng Investment Center
------
Cai Xiaoru, actual controller of Tatwah Smartech Co., Ltd. (002512.SZ) plans to transfer his 85,412,300 shares (accounting for 7.8 percent of the company's total share capital) to Zhuhai Zhicheng Investment Center (Limited Partnership) at a price of 18.56 yuan per share. It sees 12 percent premium when compared with the company's latest closing price of 16.50 yuan. The deal will cost 1.585 billion yuan. After the deal is finished, Cai's shareholding will decrease to 23.39 percent but he will still be the company's actual controller.
Cai transferred the held 10.07 percent equities to Zhuhai Zhiyuan Investment last November, but Zhicheng Investment Center and Zhuhai Zhiyuan Investment are persons acting in concert, and the actual controller is Xie Zhikun. Therefore, Zhongzhi Enterprise Group Co., Ltd. will hold 17.87 percent equities of the listed company, making it the second largest shareholder. Subsidiaries of Zhongzhi Enterprise Group also indicated this move is to achieve value-added benefits of the shares. In next 12 months, there still is a possibility to decrease the shareholdings.
○ Actual controller of Int'l Group possibly to alter to SASAC, ZJ
------
Sinochem Group, actual controller of Zhejiang Int'l Group Co., Ltd. (000411.SZ), is negotiating with State-owned Assets Supervision and Administration Commission of Zhejiang Province (SASAC, ZJ) on major issues. If everything goes well, the controlling shareholder of the listed company will be altered to Zhejiang International Business Group Co., Ltd., with actual controller going to be altered to SASAC, ZJ. Its current controlling shareholder Zhejiang Pinghu Hualong Industrial Co., Ltd. and related parties totally hold 28.08 percent equities, and Sinochem Group is now the final controller.
○ Chengtun Mining Group increases private placement price
------
According to new private placement scheme of Chengtun Mining Group Co., Ltd. (600711.SH), it increases the price to 6.9 yuan per share, with private placement no more than 362 million shares, and reduces fundraising to a scale no more than 2.5 billion yuan. The private placement will be offered to special targets, such as Xiamen C＆D Inc. (600153.SH), asset management plan of Xiamen ITG Group Corp., Ltd. (600755.SH), Yang Xueping who is actual controller of Dr.peng Telecom ＆ Media Group Co., Ltd. (600804.SH) and etc. The fund is raised for supplementing the liquidity, investing in Hengyuan Xinmao project, and building information-oriented platform.
○ The pure electrical passenger car project with annual output of 50,000 of Chongqing Jinkang, a wholly owned subsidiary of Chongqing Sokon Industry Group Co., Ltd. (601127.SH) was approved by the National Development and Reform Commission (NDRC). The listed company indicated that it symbolizes the company has obtained the qualification for the production of pure electric passenger car.
[Financial Reports Express]
○ Multiple companies forecast performance growth
------
Beijing Sanju Environmental Protection ＆ New Materials Co., Ltd. (300072.SZ) forecasts 90 percent to 100 percent growth in the annual report. The controlling shareholder proposes 5-for-10 conversion of capital surplus into shares combined with 2 yuan dividend for each 10 shares. Jiangsu Zhongtian Technology Co., Ltd. (600522.SH) forecasts 60 percent to 80 percent growth in the annual report, primarily due to the price hike of optical fiber. Shenzhen V＆T Technologies Co., Ltd. (300484.SZ) forecasts 104 percent to 126 percent growth in the annual report, primarily due to substantial growth of the company's sales of machine controller for electric passenger cars. Shanghai Dingli Technology Development (Group) Co., Ltd. (600614.SH) forecasts 90 percent to 110 percent growth in the annual report, primarily due consolidation of the financial statements of Luoyang Pengqi.
[Trading Alarm]
○ Three new shares offer for subscription on Dec. 11
------
China Galaxy Securities (780881.SZ) will offer for subscription at 6.81 yuan per share. The upper limit for each applicant is 180,000 shares. The company is primarily engaged in comprehensive securities service. Guangdong Xiongsu Technology Industrial Co., Ltd. (300599.SZ) will offer for subscription at 7.04 yuan per share. The upper limit for each applicant is 300,000 shares. The company is primarily engaged in plastic conduit. ArcherMind Technology (Nanjing) Co., Ltd. (300598.SZ) will offer for subscription at 8.73 yuan per share. The upper limit for each applicant is 200,000 shares. The company is primarily engaged in software technology service.
TOP
○ CBRC arranges debt-for-equity swaps, SOEs with high debts to participate
○ Policies support private investment in medical sector, private hospitals expected to expand rapidly
○ Glyphosate price keeps growing, institutions think potential for price to continue to hike
○ Actual controller of Tatwah Smartech transfers 7.8 pct. equity to Zhicheng Investment Center, actual controller of Int'l Group possibly to change
[SSN Focus]
○ CBRC arranges debt-for-equity swaps, SOEs with high debts to participate
------
China Banking Regulatory Commission (CBRC) held a video and telephone conference on the supervision and regulation on the national banking industry in 2017 on Jan. 10 and made plan on key tasks of the year. It proposed to steadily conduct market-based debt-for-equity swaps and support de-leveraging. The subjects, prices and conditions of debt-for-equity swaps shall be determined through independent negotiation and quality enterprises with rosy prospects and temporary difficulties will be encouraged to conduct market-based debt-for-equity swaps. The total agreed amount of debt-for-equity swaps has exceeded 300 billion yuan, indicated Xu Shaoshi, Chairman of National Development and Reform Commission, on the same day.
Comment: State-owned banks have introduced various debt-for-equity swap programs recently. The Industrial and Commercial Bank of China and SOEs in Shanxi, including Taiyuan Iron ＆ Steel Group, Datong Coal Mine Group and Yangquan Coal Industry Group, China Construction Bank and SOEs in Shaanxi, including Shaanxi Coal and Chemical Industry Group, Shaanxi Non-ferrous Metals Holding Group and Shaanxi Energy Group have signed agreements with tens of billions of yuan. Institutes are rosy about SOEs with high debts in coal, iron ＆ steel, non-ferrous and other cyclical industries to benefit from optimized financing structure. The profitability of AMC companies as professional agencies for the disposal of bad assets will be improved.
[SSN Selection]
○ The government work report released by Ningxia Hui autonomous region on Jan. 10 proposed to actively develop mixed-ownership economy. The government work report released by Tibet autonomous region laid stress on the integration and reorganization of state-owned enterprises.
○ The National Technology Work Conference was held on Jan. 10. Wan Gang, minister of science and technology, indicated that the special plan for artificial intelligence will be worked out in 2017.
○ The Air Traffic Management Bureau of Civil Aviation Administration of China indicated that the investment demand in China's air traffic management system is expected to total 57 billion yuan during the 13th five-year plan period (2016-2020), and the construction of infrastructure for air traffic management will be accelerated.
○ SSN learnt that the core premium indicators of listed insurance companies embraced "a good start" in the first week of 2017, and product cost also obviously declined.
○ The securities margin witnessed a net outflow of 18.7 billion yuan in the first week after the New Year, while the same periods of previous two years both saw a net inflow of over 100 billion yuan.
TOP
[Industry Information]
○ Policies support private investment in medical sector, private hospitals expected to expand rapidly
------
The State Council proposed various development indicators for the medical sector in the recently-issued 13th Five-Year Plan on public healthcare. One of the most prominent indicators is that by 2020 the proportion of berths in private hospitals should increase to over 30 percent from 19.4 percent in 2015. The plan also proposes to develop private investment in the medical sector and encourage private capital to participate in the health service sector.
Comment: Institutes point out that under the background of supportive policies and extremely imbalance of supply and demand of medical services, private capital will maintain a high passion to invest in hospitals. Private hospitals are expected to integrate doctor resources to improve their quality and contents of medical services and expand rapidly. Ningbo Sanxing Medical Electric Co., Ltd. (601567.SH) has transformed its business to medical services after acquiring the largest grade-III hospital Zhejiang University Mingzhou Hospital in Zhejiang province. Guizhou Yibai Pharmaceutical Co., Ltd. (600594.SH) owns three hospitals and several treatment centers. The company has actively transformed to precision treatment for tumor.
TOP
○ Glyphosate price keeps growing, institutions think potential for price to continue to hike
------
Enterprises continue to raise quotation of glyphosate in recent week. FOB of 97 percent of raw powder of Jiangsu Yangnong Chemical Co., Ltd. (600486.SH) at Port of Shanghai is raised by 200 US dollars per ton to 3,500-3,600 US dollars per ton now. Price of 98 percent of pmida of Sichuan Hebang Biotechnology Co., Ltd. (603077.SH) is raised by 500 yuan per ton to 16,000 yuan per ton in Port of Shanghai. Glyphosate price keeps growing by over 40 percent since the fourth quarter of last year.
Comment: Securities traders think that there is still potential for price of glyphosate to increase driven by tightened policy on environmental protection and small input in newly-added capacity. In addition, re-stocking of downstream enterprises and recovery in agrochemical industry will boost demand to pick up. Yangnong Chemical owns annual capacity of producing 30,000 tons of glyphosate. It has sophisticated technologies, which are in accordance with environmental protection, and has stable profitability. Hebang Biotechnology owns production capacity of 50,000 tons of glyphosate and 135,000 tons of pmida. It keeps running in full capacity since the beginning of this year.
TOP
[Announcement Interpretation]
○ Actual controller of Tatwah Smartech transfers 7.8 pct. equity to Zhicheng Investment Center
------
Cai Xiaoru, actual controller of Tatwah Smartech Co., Ltd. (002512.SZ) plans to transfer his 85,412,300 shares (accounting for 7.8 percent of the company's total share capital) to Zhuhai Zhicheng Investment Center (Limited Partnership) at a price of 18.56 yuan per share. It sees 12 percent premium when compared with the company's latest closing price of 16.50 yuan. The deal will cost 1.585 billion yuan. After the deal is finished, Cai's shareholding will decrease to 23.39 percent but he will still be the company's actual controller.
Cai transferred the held 10.07 percent equities to Zhuhai Zhiyuan Investment last November, but Zhicheng Investment Center and Zhuhai Zhiyuan Investment are persons acting in concert, and the actual controller is Xie Zhikun. Therefore, Zhongzhi Enterprise Group Co., Ltd. will hold 17.87 percent equities of the listed company, making it the second largest shareholder. Subsidiaries of Zhongzhi Enterprise Group also indicated this move is to achieve value-added benefits of the shares. In next 12 months, there still is a possibility to decrease the shareholdings.
○ Actual controller of Int'l Group possibly to alter to SASAC, ZJ
------
Sinochem Group, actual controller of Zhejiang Int'l Group Co., Ltd. (000411.SZ), is negotiating with State-owned Assets Supervision and Administration Commission of Zhejiang Province (SASAC, ZJ) on major issues. If everything goes well, the controlling shareholder of the listed company will be altered to Zhejiang International Business Group Co., Ltd., with actual controller going to be altered to SASAC, ZJ. Its current controlling shareholder Zhejiang Pinghu Hualong Industrial Co., Ltd. and related parties totally hold 28.08 percent equities, and Sinochem Group is now the final controller.
○ Chengtun Mining Group increases private placement price
------
According to new private placement scheme of Chengtun Mining Group Co., Ltd. (600711.SH), it increases the price to 6.9 yuan per share, with private placement no more than 362 million shares, and reduces fundraising to a scale no more than 2.5 billion yuan. The private placement will be offered to special targets, such as Xiamen C＆D Inc. (600153.SH), asset management plan of Xiamen ITG Group Corp., Ltd. (600755.SH), Yang Xueping who is actual controller of Dr.peng Telecom ＆ Media Group Co., Ltd. (600804.SH) and etc. The fund is raised for supplementing the liquidity, investing in Hengyuan Xinmao project, and building information-oriented platform.
○ The pure electrical passenger car project with annual output of 50,000 of Chongqing Jinkang, a wholly owned subsidiary of Chongqing Sokon Industry Group Co., Ltd. (601127.SH) was approved by the National Development and Reform Commission (NDRC). The listed company indicated that it symbolizes the company has obtained the qualification for the production of pure electric passenger car.
[Financial Reports Express]
○ Multiple companies forecast performance growth
------
Beijing Sanju Environmental Protection ＆ New Materials Co., Ltd. (300072.SZ) forecasts 90 percent to 100 percent growth in the annual report. The controlling shareholder proposes 5-for-10 conversion of capital surplus into shares combined with 2 yuan dividend for each 10 shares. Jiangsu Zhongtian Technology Co., Ltd. (600522.SH) forecasts 60 percent to 80 percent growth in the annual report, primarily due to the price hike of optical fiber. Shenzhen V＆T Technologies Co., Ltd. (300484.SZ) forecasts 104 percent to 126 percent growth in the annual report, primarily due to substantial growth of the company's sales of machine controller for electric passenger cars. Shanghai Dingli Technology Development (Group) Co., Ltd. (600614.SH) forecasts 90 percent to 110 percent growth in the annual report, primarily due consolidation of the financial statements of Luoyang Pengqi.
[Trading Alarm]
○ Three new shares offer for subscription on Dec. 11
------
China Galaxy Securities (780881.SZ) will offer for subscription at 6.81 yuan per share. The upper limit for each applicant is 180,000 shares. The company is primarily engaged in comprehensive securities service. Guangdong Xiongsu Technology Industrial Co., Ltd. (300599.SZ) will offer for subscription at 7.04 yuan per share. The upper limit for each applicant is 300,000 shares. The company is primarily engaged in plastic conduit. ArcherMind Technology (Nanjing) Co., Ltd. (300598.SZ) will offer for subscription at 8.73 yuan per share. The upper limit for each applicant is 200,000 shares. The company is primarily engaged in software technology service.
TOP
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